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Gold-backed digital asset Tether Gold (XAUt) is gaining momentum as global demand for bullion rises, fueled by heightened macroeconomic uncertainty and record inflows into gold exchange-traded funds (ETFs).
The surge in demand is linked to escalating global risks, including trade conflicts and concerns over a potential recession. Ongoing economic and geopolitical uncertainty during the presidency of U.S. President Donald Trump has further amplified investor interest in gold as a safe-haven asset.
Amid volatile macroeconomic conditions, institutional investors and central banks have sparked a new wave of demand for gold, with gold bullion reaching record highs during the year.
The surge has also increased interest in Tether's gold-backed digital asset. At the end of the second quarter, Tether Gold was trading at approximately $3,330 per ounce.
According to the latest report verified by BDO Italia, this digital commodity, which is fully backed by physical gold, is based on 7.66 tons of fine troy ounces of gold reserves.
The reserve supports over 259,000 XAUt tokens in circulation, while the asset's market value exceeds $800 million. Tether Gold's price is tracking closely with the market value of physical gold, which is just below $3,400 per ounce.
XAUt, which began trading in January 2020, is listed on multiple exchanges.
XAUt combines gold's timeless safe-haven characteristics with the unique advantages of cryptocurrencies, such as portability, divisibility, and easy access, bringing the precious metal onto the blockchain. According to CoinMarketCap data, the XAUt price has increased by 40% over the past 12 months, largely mirroring the performance of spot gold.
While bitcoin is often referred to as “digital gold” due to its scarcity and portability, physical gold continues to be regarded as the most reliable asset during times of uncertainty.
In the cryptocurrency market, Tether Gold stands out as a tokenized counterpart to physical bullion.
According to the World Gold Council (WGC), central banks around the world purchased over 1,000 tons of gold bullion on multiple occasions in 2024. Institutional investors followed suit, directing billions of dollars into gold ETFs, particularly in the second half of the year.
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